Rajkot machine tools industry faces slowdown with fall in demand

The machine tools industry in Rajkot is facing slowdown in business following steep fall in demand which industry experts estimate to be nearly 40 per cent.

"Compared to other industries, our condition is critical as demand for machine tools is very dim. Business has been falling over the last two years," said Raju Bhanderi, vice-president, Machine Tools Manufacturers Association of Rajkot (MTMA).

Rajkot is known for conventional machine tools and most of the demand is from small and medium-sized industries.

"At present, no one is willing to take risk to invest in capital goods. As a consequence, demand for machine tools has reduced," Bhanderi said.

Demand for machine tools industries in Rajkot mostly comes from parts of Gujarat, Maharashtra, Rajasthan, Madhya Pradesh, Delhi and South India.

Bhanderi said, "Conventional machine tools are mainly used by Small and Medium Enterprises (SMEs). Machine tools are the capital equipment for any kind of expansion in industries but currently no one is ready to risk expansions as they have just come out of recession. Under the circumstances, demand has fallen by nearly 40 percent."

Less demand has seen manufacturers reduce cost of manufactured products over the last two years by nearly 5-15 percent, resulting in reduction in profits.

Dinesh Khambhayta, secretary, MTMA said, "Over the last two years, many manufacturers have seen reduction in profit as dealers or direct buyers have bargained for price because of overall slowdown. We hope that time will change in the next six months."

The turnover of machine tools industry in Rajkot was around Rs 1,000 crore in 2013-14 and the industry expects similar turnover in the current financial year. At 450-500 units, the Rajkot machine tools industry is one of the major machine tools clusters in the country.